Last Updated on April 9, 2024
In the dynamic world of real estate, timing is everything.
As trusted advisors to homebuyers, we understand the significance of making informed decisions in a market that’s as unpredictable as it is promising. Today, we’re here to shed light on a crucial aspect often overlooked: the cost of waiting to buy a home.
It’s no secret that home values tend to climb steadily over time. While market fluctuations may occur, the overall trajectory points upward. In the current market trend, home values rose by a remarkable 6.80% last year, surpassing the long-term average of 4.58%.
However, many homebuyers fixate on mortgage rates. Understandably, they wait for rates to decrease, hoping for a better deal. But here’s the catch: waiting might not always work in their favor.
Consider this scenario: you postpone your home purchase, anticipating a drop in mortgage rates. Meanwhile, home values continue to rise. When you’re finally ready to make a move, you find yourself paying significantly more for the same property you could have purchased earlier. Let’s calculate the new monthly mortgage payment for a $200,000 loan if you wait one year to buy.
- We’ll assume that the home appreciates by 6.80% during that year, and the interest rate does not change.
- The new home price after one year of appreciation is $213,600
- The borrower would pay approximately $66.15 more per month by waiting one year to buy.
- So, by waiting one year to buy, the borrower would pay approximately $23,814 more over the life of the loan than by buying now.
While buying a house right now might feel overwhelming, the cost of waiting can be a burden on finances down the road. If now’s the time to buy, connect with a Realtor or mortgage professional today.
About Allen Tate Realtors
Allen Tate Realtors has been helping our clients achieve their real estate goals since 1957 and is the #1 real estate company in the Carolinas. With local roots and global connections, thanks to our partnership with Leading Real Estate Companies of the World, our real estate agents can provide their customers with superior service, unparalleled connections, and vast market knowledge. Allen Tate provides real estate, mortgage, insurance, and relocation services throughout the entire homeownership lifecycle.
Allen Tate Companies is a proud partner of Howard Hanna Real Estate Services, the largest independent, family-owned real estate company in the country. With more than 13,000 sales associates and staff members across the combined companies, our agents are the best of the best.
